An anticipated decision by the U.S. Department of Commerce (DOC) to impose restrictions or tariffs on imported steel could have a "cascading, negative impact" on America's tire industry.
Anne Forristall Luke, CEO and president of the U.S. Tire Manufacturers Association, the former Rubber Manufacturers Association, makes a case for the DOC and President Donald Trump to exempt certain types of steel wire rod, tire cord and bead wire used in tire manufacturing from any pending action. She wrote about the topic in a piece which was published in The Hill.
"In the United States, tire manufacturers provide over 737,000 jobs, operate 55 tire-related manufacturing facilities in 19 states and generate over $148.4 billion in sales as an industry, demonstrating the important and critical role tire manufacturing plays in the nation’s shipping and commerce needs.
"And the U.S. is attracting more tire makers: by 2019, seven offshore companies will have opened their first U.S. manufacturing facilities bringing additional much-needed jobs.
"Virtually all steel used in U.S. tire manufacturing must be imported, as domestic steel suppliers cannot meet volume and quality needs for this critical tire safety component. Thus any trade constraint could potentially have a cascading, negative impact on U.S. commerce nationwide, as the transportation industry depends on a reliable supply of tires to ship goods. Additionally, the U.S. military depends on the tire manufacturing industry to supply tires used to protect our national security."
Luke points out that the steel used in tire manufacturing accounts for "less than 1% of total U.S. steel production," and thus an exemption wouldn't have a crushing effect on domestic steel makers. However, she says, "steel does play a vital role in the production of tires. Steel is a critical part of what makes a tire functional as well as safe to operate, and tires manufactured in the United States are responsible for safely transporting millions of Americans and millions of tons of goods each day."
Given the U.S. military's need for tires, Luke also makes a case that exempting certain steel from tariffs is a national security issue.
"That’s why the type of rulemaking currently being considered by the Commerce Department must allow for sensible exemptions to ensure that vital national industries such as tire manufacturing remain intact, to avoid ripple effects in today’s integrated economy."